Behind Burma’s Fuel Price Rise

The fuel price increase in Burma last week has been greeted by shock, amazement, and despair. The question many are asking is, how can this be?

How can a country so rich in gas and oil be unable to provide its own citizens with affordable supplies? How can a government raise prices such a huge extent, especially when it is selling gas for what must be an incredible profit?


So far, various explanations have been put forward by analysts. Some have suggested the economic mismanagement of the regime is largely to blame, while others have pointed to an emerging foreign exchange and budgetary crisis as reasons behind the move.

Some others have warned the political machinations of the regime should not be underestimated. The price increases, in sparking off popular protests, could serve as a pretext for the State Peace and Development Council to launch another political crackdown, prolongation of National Convention proceedings or even postponement of the upcoming visit by UN envoy Ibrahim Gambari.

All these may perhaps be true. But to fully understand the pressures behind the increase in fuel prices, it is also important to consider some deeper structural characteristics of the Burmese economy and oil and gas sector.

Irrawaddy News